As a result of both security concerns and the need for rapid, low-cost deployment, wireless technologies are expected to dominate the voice, data, and Internet services markets in Iraq, said IDC.
IDC believes that mobile GSM will substitute fixed-line PSTN, while VSAT, wireless LAN, broadband fixed wireless, satellite, microwave links, and free space optics are likely to dominate data and Internet access connections, in addition to their use in national and international network transmission.
For voice services, the shortage of fixed-line telephony service across the country has heightened the demand for mobile telephony in Iraq. This has been reflected not only in the encouraging uptake for satellite handsets across the country, but also in the increase in the usage pattern for these satellite handsets. Not surprisingly, therefore, regional and some international investors and operators rushed to bid for the three regional mobile license tenders offered by the Coalition Provision Authority (CPA).
For Internet access and data services, IDC contends that wireless technologies will also dominate as international bandwidth for Internet access services is now almost exclusively over satellite gateways, and multinationals and Non-Governmental Organizations (NGOs) are using broadband satellite and VSAT for data and Internet connectivity.
Even with such strong demand for wireless services, however, the outlook for voice and data services demand going forward is blurred. "The high degree of uncertainty surrounding the political, economic, and security developments in Iraq renders inappropriate any single set of forecasts for the telecommunications markets of this country,” asserts senior analyst at IDC CEMA's Telecommunications Group Mohsen Malaki.
“The evolution of the security situation in Iraq should be the central variable for any scenario analysis of this market," he said. "Security concerns are likely to drive investment decisions, which will in turn affect employment, the influx of foreign expertise and businesses, consumer and business spending, and the availability and coverage of telecommunications networks."
IDC has conducted a scenario analysis of the fixed-line telephony, mobile services, and Internet access markets in Iraq using optimistic and pessimistic assumptions about the security situation in the country.
For voice services, Optimistic Scenario assumptions mean rapid growth of the country's total connectivity by the end of 2005, which is the duration of the recently awarded mobile services licenses, followed by further robust growth. Total connections are projected to reach 5.41 million by the end of 2008.
As for Internet access, IDC expects a substantial increase in Internet access connections in the Optimistic Scenario, with a compound annual growth rate (CAGR) of 60 percent between 2003 and 2008, but only a 19 percent CAGR in the Pessimistic Scenario.
Broadband should see a greater variance between the Optimistic and Pessimistic Scenarios, since much of the demand for broadband will likely come from the international businesses setting up shop in the country, as well as from some government bodies and the oil industry. — (menareport.com)
© 2003 Mena Report (www.menareport.com)
